To buy a house

[PepsiCoco]

After fleeing domestic violence 18 years ago, I private rented until I was lucky enough to get a council/association house 6 years ago. After being on the list for over 10 years.

Recently I inherited £40k.
I don’t have the right to buy as it’s association house and new build.
Would you remain in current house, nice 3 bed semi, driveway etc. Or use the money for deposit and buy a two bed terrace, with no parking etc, approx £160k in my area.

As a single parent (working full time) I did get universal credit but that will stop when my savings go over £6-12k. Presumably if I bought, then I would continue to get it. For 2 more years only.

Sorry forgot to add.

YABU - don’t buy a house and continue to rent. Albeit losing your benefits until the money runs out
YANBU - Buy a house

Any other advice much appreciated

I would buy if I could afford the mortgage repayments. If your continue to rent you will have to continue to do so in retirement whereas if you buy you will eventually pay the mortgage off and have no monthly housing cost.

If the mortgage payments are significantly higher than the rent payments I would consider staying in the better house that you wouldn't have to pay repairs and maintenance for.
Without figures it is difficult to know. It sounds like you you have to choose between 2 reasonable choices which will make the decision more difficult but less important. Either way you will have a good house you can afford.

It depends what the mortgage payments will be - suggest discussing with a mortgage advisor, L&C is good and free to use. If mortgage payments similar to rent I'd be inclined to buy, so you will have an asset and hopefully no mortgage once you retire.

Could you afford the repayments, I believe (someone correct me if not) if your UC has a housing element you will use that as it will help you cover your rent but not your mortgage?

What @Pretendthatwearedead said.

Plus, with a 3 bed at present will you be subject to so-called bedroom tax once your Dc leave home? And / or higher council tax band than a smaller house you buy?

Bear in mind that you will need maintenance costs for your own house.

But if you can afford it my instinct would be to buy. Apart from anything else there would be the potential to leave an inheritance to your Dc. Not guaranteed but it creates the possibility.

Yanbu, buy if you can afford the repayments.

You'll loose the housing element on uc but your personal allowance will be higher.

Most estate agents have mortgage advisers in branch. (However much they push, you can just use them for advice and then use someone else or go to a bank), so why not go along and find out what you can afford.

as others have said in the long term you’ll be better off in your own place. If your mortgage payments are £500 a month, they might change with interest rates in the future but they’ll always be in that ballpark whereas your rent will rise with inflation. In 20 years you’ll still be paying about £500 on a mortgage, but your rent could’ve doubled. You also won’t have housing costs in retirement.

Thank you for the advice